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How Much Does It Cost To Build A Guest House?

Typical Range: $45,000 - $100,000

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Guest House Costs

Building a modular 600-square foot guest house costs $55,000 on average. Costs range from $45,000 to $65,000 including materials, building permits and installation but could easily cost $100,000 or more, depending on size and where you live.

If you’re planning to build a custom, freestanding guest house, expect to pay anywhere from $100 to $500 per square foot. For a 600 square foot cottage, this cost ranges from $60,000 to $300,000.

Average Cost to Build a Guest House*

Average Cost$55,000
High Cost$100,000+
Low Cost$45,000

*for a 600-square foot guest house.

Backyard Guest House, Casita or Cottage Cost

A 600-square foot backyard guest house, casita or cottage typically costs $55,000, if going the modular route. For a custom build, expect to pay between $100 and $500 per square foot. Just hiring a construction manager costs $21,500 on average; it’s good to note that 5 to 15 percent of your project costs will go to them.

While the average cost of a building permit is $1,170, guest house permits for this project are often between $1,200 and $1,500. Expect to pay more if you live on the East or West Coast or in a bigger city.

Guest houses go by many names, such as casita, guest cottage, studio guest house, mother-in-law house and granny flat.

Garage Guest House Cost

The cost to convert a garage into a guest house is $15,000 to $30,000at least. Expect to go beyond this price range if you need a lot of plumbing and other work to get the space up to building code.

Some people add a guest house above their garage. This home addition costs between $110 and $120 per square foot.

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Cost to Build a Guest House by Size

Guest House SizeCost Range: ModularCost Range: Custom Build
600-700 square feet$45,000 - $65,000$60,000 - $350,000
700-800 square feet$49,000 - $88,000$70,000 - $400,000
800-900 square feet$56,000 - $99,000$80,000 - $450,000
900-1,000 square feet$62,000 - $110,000$90,000 - $500,000
1,000+ square feet$70,000+$100,000+

One thing to note: when contractors work on a custom build, they usually aim for a square footage minimum or even a range in the planning process. This is because building permits often require minimum square footage, so contractors go over the minimum to better ensure their chances for approval.

While custom builds are much more expensive than modular or prefab guest houses, they last longer. Modular homes tend to have a life expectancy of 35 years.

Guest House Construction Cost

For just the labor and construction you’ll pay between $18,000 and $26,000 for a 600-square foot guest house. About 40% of the cost to build a house goes towards labor alone.

DIY Build a Guest House vs. Hiring a Professional

Architects, engineers and contractors have years of experience and licensing to perform the complex process of building a house. Unless you’re a contractor, you’re taking on a massively expensive and time-consuming task.

Just to get a permit you’ll need to prepare a site plan and build your own blueprint; this can take experts weeks to months before they get approval. If you go the DIY route and have little to no experience, there’s a good chance the city will reject your plan, thus adding even more time to your project.


How do you build a guest house?

Guest houses are built the same way as regular houses, unless they’re prefab homes. For prefab or modular houses, it takes less time because builders are essentially assembling premade pieces to form a house. Like building a regular house, builders will still need to prepare a foundation and acquire permits.

Can I build a guest house on my property?

States allow you to build a guest house on your property, but each municipality has different rules and building codes. Some states are more lenient than others for building, but every build and even remodeling needs an approved permit before beginning. Contact a home builder near you to learn more.

Two instances where you might not be able to build on your property is if you live in a historic district or have an HOA. Do some research in your area to find out specific rules.

Does a guest house increase home value?

Guest houses can increase home value when built properly by a licensed professional. Some homeowners are able to rent out their cottage as a vacation rental and others turn theirs into an accessory dwelling unit for long-term tenant rental. This provides homeowners with a pretty quick turnaround of ROI; in some instances the guest house could pay for itself.

On the flipside, a guest house that’s poorly built (or even some prefab units) could actually harm your home’s value. Prefab or modular homes require regular maintenance to ensure they last. If you try to sell your property 30 years from now with a decrepit guest house that’s falling apart, it will almost certainly lower your ROI.

How much are modular guest houses?

A 600- to 700-square foot modular guest house costs between $45,000 and $65,000 on average. If you up the square footage to 1,000 to 1,200 you can expect to pay between $70,000 and $80,000.

How much is it to build a mother-in-law house?

A mother-in-law house is another term for a guest house and building one from scratch can cost anywhere from $100 to $500 per square foot.

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